Organisations & communities in the knowledge age

The sustaining power of self-interest

Stephen Bounds — Fri, 04/07/2014 - 12:10

I have always been suspicious of altruism. Humans are capable of wonderful and unselfish acts, but when trying to determine the behaviour of an overall system, I think it's far more reasonable to expect that people will act to benefit their own interests.

Why? Three basic reasons:

Local judgement. People understand and focus on their local situation better and in more detail than a more distant consideration.

You're not me. A person is often not able to perfectly conceptualise and communicate their wishes and needs to others, and therefore are best placed to advocate and act on their own behalf.

Nonlinearity. Complex systems are nondeterministic. Therefore, even if a person wished to act altruistically to achieve some abstractly-concepted best outcome for the whole system, they would not be able to.

However, even people acting in self-interest can lead to beneficial outcomes for a society. This is the essence of Adam Smith's invisible hand theory, which posits that competitive markets do a good job of allocating resources. However, modern economics add the caveats that competitive markets only function in this way with perfect information and no externalities. Correcting these imbalances is part of the justification for regulation and legislation restraining free trade.

The keyword, though, is "enlightened". Acting on the basis of poor knowledge, a despot may seek to confiscate lands without consideration for the long-term impact on their wealth. A market seeking to exploit a monopoly at the cost of driving parallel innovations which will eventually lead to its own destruction (hello, intellectual property owners).

So the fact that a particular course of action would lead to a net benefit for all within a system is no guarantee that the action will happen. Conversely, only actions which are then stabilised and reinforced through a realisation of personal self-interest will result in sustainable and systemic change.

To tie this back to knowledge management briefly: Much like democracy is a evolutionary side-effect rather than a normative ideal, what we recognise as good KM practice will often only be possible through evolutionary change based on individual and group self-interest.

If a KM initiative fails, then it would seem that either the needed change was either never achieved in the first place, or the self-interest (in perception or reality) to sustain the change wasn't there.

I believe that the maturing of KM as a discipline will see us dropping idealistic language and focusing on the reality that self-interest is what will rule.